Welcome to the latest edition of This Week in Pensions! We have gathered the best stories about pensions and retirement security from the previous week. You need to know this news in the fight for a secure retirement.

North Dakota 

It was an active week in North Dakota regarding public employees’ continuing fight to protect their defined-benefit pensions. NPPC Executive Director Kendal Killian was quoted in a Minot Daily News article, saying, “If you jeopardize the pension of these workers, you’re also jeopardizing the residual economic benefits that pumping these dollars into the state does. And (that) will eventually create kind of a domino or chain reaction that can affect everyone.” 

The Minot Daily News also noted that Alaska and Palm Beach, Florida, later regretted closing their pension systems. States who have closed their pension systems, like Alaska, must now absorb extra costs to recruit and train workers. The House plan (HB 1040) to destroy the pension system has been estimated to cost North Dakota $5.5 billion. So, not only would HB 1040 rob dedicated public servants of their pensions, but the huge $5.5 price tag could, according to KFYR TV, be the single most costly bill in the 134-year history of the state. 

Ultimately the week was a mixed verdict legislatively in the Peace Garden State. HB 1040 passed House 77-16 on Wednesday. This came the day after the state senate passed SB 2239 by a 34-13 margin. The Senate bill– supported by NPPC allies–would allocate $250 million to shore up NDPERS and would not close the plan to future nurses and educators. 


This week in Alaska, the Senate Finance Committee heard testimony from the Division of Retirement and Benefits director concerning differences between the state’s current defined-contribution retirement plan and the older defined-benefit pension plan. Alaska closed the Teachers’ Retirement System (TRS) and the Public Employee Retirement System (PERS) in 2006 for future employees. Public employees now participate in a defined-contribution retirement plan. Meanwhile, agencies and school districts have been plagued with recruitment and retention issues, which many Alaska leaders believe was caused by eliminating the pension benefit 17 years ago. 

In his testimony, the director painted an overly generous picture of defined-contribution plans that was devoid of reality. Defined-contribution plans, which put all of the risk on individual investors, rely on good investment returns year after year. In this case, the director projected annual returns of 7%. The difference between the plans was stark. For example, many employees who have participated in the defined-contribution plan for the last 15 years would only receive “18% of the average earnings if they retired today.” That is far from the pension plan, where 15-year employees would receive 30% of their average earnings. Senator Jesse Kiehl said it best of the projections and presentation of the director, “This is put together by Miss Rose E. Scenario, and it fails over and over.” 

Look for a bill to once again provide a defined benefit pension for hard-working Alaska public servants to be dropped next week. 
Be sure to check back next Friday for the latest in the fight for a secure retirement! Sign up for NPPC News Clips to receive daily pension news from across the country directly to your inbox.